OCTOBER 13 — Ask a small business owner about their business and they can probably tell you almost everything.

Which day is usually busy. Which product customers ask for most. Which supplier can be trusted. When sales normally slow down. Which customer always orders the same thing. After several years in business, you develop a kind of instinct.

You can check the stall at 8 p.m. and roughly gauge whether it has been a good day. You can check the remaining stock to see what needs to be ordered tomorrow. That knowledge is valuable. It comes from experience that no business course can fully teach. But there is one problem.

What happens when everything the business knows is still inside the owner's head?

“I already know my business”

Imagine a hawker who has been selling food for five years. She already knows Friday evenings are busy. She knows one menu item sells particularly well. She knows some ingredients regularly remain unsold at the end of the day. Ask her about these things and she might simply say: “Saya dah biasa. Saya tahu dah pattern customer saya.”

And she probably does. But knowing the pattern is different from using it. If Friday is always busy, does she know how much sales normally increase? If one menu item sells the most, does she know whether it also gives the best profit? If ingredients are regularly left over, does she know how much that waste costs her every month? This is where years of experience can become much more valuable.

Your memory is useful. but it is not a business system

For a very small business, remembering everything may work. The owner remembers stock. She remembers prices. She remembers who has paid and who has not. She knows what customers usually want. But business gets complicated surprisingly quickly.

Today, there are cash payments, QR payments, delivery platforms and online orders. There are supplier prices, packaging costs, stock levels and customer messages to manage. The amount of information grows.

Our memory does not. This does not mean every hawker needs expensive software or a complicated accounting system. Sometimes, a notebook is enough. A spreadsheet can be enough. A simple daily record can be enough. The important thing is not how sophisticated the system looks. The important thing is whether it helps us see something we could not see before.

Start with one question

Many small businesses collect information without actually using it. There may be receipts everywhere, QR transactions in the phone, orders in WhatsApp, the sales information inside an app and supplier invoices in a drawer. Definitely, the information exists. But information only becomes useful when it changes a decision. Take something as simple as food waste. Instead of saying: “Selalu ada lebih sikit.”

Record it for a month. Which item is left over? On which days? How much? What did those ingredients cost? Suddenly, something that felt small may become visible. RM10 of unnecessary waste a day does not sound serious. But repeated for 30 days, it becomes RM300. Repeated for a year, it becomes RM3,600. Nothing about the business changed during that calculation. Only our understanding of it did. And once we understand it, we can decide what to change.

Don't record everything

There is another mistake we should avoid. When people hear “business records”, they sometimes imagine recording every possible detail. That can become another burden. For a busy microbusiness owner, the better question is: What do I need to know to make one decision better?

If stock is the problem, track stock. If you are unsure about profit, start with proper costing. If certain days are always slow, compare daily sales. If customers seem to disappear after their first purchase, look at repeat customers. Start with the problem, not the system. A business does not become better managed because it has more spreadsheets. It becomes better managed when the information in those spreadsheets leads to better decisions.

What has changed because of what you learned?

Perhaps this is the more important question after several years in business. Not: “How long have I been doing this?” But: “What have I changed because of what those years taught me?”

If you learned that Mondays are slow, did purchasing change? If you learned that customers prefer certain products, did your product mix change? If supplier prices keep increasing, did your costing change? If the same stock keeps going unsold, did your ordering change? Experience should eventually leave some evidence behind. A better routine, a clearer record, less waste, a more accurate price, a better purchasing decision, and a mistake that does not need to happen for the tenth time. At the beginning, the entrepreneur learns the business. But after several years, something else should begin to happen.

The business should start learning from the entrepreneur. You do not need to turn your small business into a large company. You do not need complicated software. And you certainly do not need to record numbers simply because somebody tells you that a “proper business” should do so.

Start smaller by taking one thing you already know from experience. Write it down. Look for the pattern. Then ask one question: What should I do differently now that I know this?

That is when experience stops being something you carry only in your head. It starts becoming part of the business itself.

* The author is a Research Fellow Post Doctorate at the Ungku Aziz Centre for Development Studies (UAC), Universiti Malaya, and can be reached at nikzirwatul@um.edu.my

** This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.